While the Senate has decided to hand over the rest of the $700 billion to Barack Obama, the House has only started debating its bill imposing oversight and restrictions on the money.

I sound like a broken record, but it's a shame that the Senate didn't take up its own bill setting conditions on the new administration as it spends the cash. Especially since one of the two amendments adopted this afternoon was Rep. Patrick Murphy's (D-PA) plan to require the Federal Reserve to reveal the mysterious terms and contracts governing its purchase of mortgage-backed securities.

"We are only just starting to get details about the contracts with the Troubled Asset Relief Program and that is only after the threat of a subpoena - we cannot let history repeat itself," Murphy said after his amendment was unanimously approved.

Too bad such a good plan won't have the force of law because the Senate won't pass its own oversight bill!

The Senate just voted down a resolution that would have prevented Barack Obama from tapping the remaining $350 billion of the financial bailout. The final vote was 42-52, and there were vote-switchers galore since the chamber last agreed to give a boatload of cash to George Bush's Treasury Department.

Read more »

The House is about to take up Financial Services Committee chairman Barney Frank's (D-MA) bill setting restrictions on the $350 billion of new bailout money sought by Barack Obama -- legislation that Democrats apparently don't believe is necessary to pass into law.

The bill is currently in the Rules Committee, that famously procedure-driven outpost that controls floor debate in the lower chamber of Congress. (For a great primer on the Rules panel, read Matt Taibbi's masterful 2005 piece on then-Rep. Bernie Sanders.) As you can see by the rules for appearing before Rules, getting one's amendment accepted by the House ain't easy -- a fact that held true under GOP control as well as Democratic.

As MarketWatch noted, Financial Services panel members weren't given a chance to offer amendments in the committee either. But look at all the damn good amendments that were thrown out there!

Rep. Kirsten Gillibrand (D-NY) would retroactively apply the bill's executive compensation rules to banks that got bailout cash under George Bush. Rep. Patrick Murphy (D-PA) would pry out more information from the Fed about its purchase of mortgage-backed securities. Rep. Brad Sherman (D-CA) would prevent companies from transferring stock en masse to their senior executives while getting bailout money.

Too bad that none of these are likely to see the light of day -- but then again, the oversight bill itself is headed for a dead stop in the Senate.

From a release that just hit my inbox:

[Sen. David] Vitter [R-LA] has authored the disapproval resolution that would block Congress's ability to release the remainder of the TARP funds.

As I mentioned earlier this morning, Tuesday lunches in the Senate are always a scene -- except when a president-elect comes to visit. Then they become a total madhouse.

The shoving scrum of reporters and cameramen aside, the Senate's mood was palpable. Remember that trust game, so popular at summer camp and workplace bonding events, where one blindfolded person had to fall backwards into a line of outstretched hands from his compatriots? Democratic senators and Obama are playing it now.

Read more »

Here's a question that, quite literally, kept me awake last night.

Before acceding to Barack Obama's request for another $350 billion of financial bailout money, the House is set to take up a bill from Financial Services Committee chairman Barney Frank (D-MA) that would require some cash to be spent on foreclosure aid and set limits on executive compensation. But Frank's counterpart in the Senate, Banking Committee chairman Chris Dodd (D-CT), has suggested that yesterday's non-specific letter from Obama adviser Larry Summers might be enough to convince him that the incoming administration plans to spend the taxpayers' money more wisely.

And even Frank (before HuffPo reported it) has already shown his unquestioning faith in the Obama team. Here's what he said Friday while introducing his own bill to provide oversight of the second $350 billion:

[II]t doesn't have to be enacted. It would be helpful if it was. But if the bill passes the House with a large majority, and we have smart and cooperative people in this administration, I'm willing to accept their word that they will act as if it were the law.

Now to my question. How would progressives react if these were Republican lawmakers agreeing to take the word of John McCain -- or any Republican president succeeding George W. Bush? Would the response be universal alarm at Congress failing to exert even minimal oversight powers? Remember how much agita this remark caused?

Even though the resolution before the Senate is not as strong as I would like ... I will take the President at his word that he will try hard to pass a UN resolution and will seek to avoid war, if at all possible.

That was Hillary Clinton in October 2002, before the vote to authorize the Iraq war.

Barney Frank (D-MA), chairman of the House Financial Services Committee, proposed on Friday to impose new limits on companies receiving funds under the Troubled Assets Relief Program (a.k.a. "the bailout"). The Frank bill is poised for a vote in the House this week, timed to coincide with the joint Bush-Obama call for Congress to release $350 billion more in bailout money.

But what's this? While the Frank bill moves towards passage, Senate Banking Committee chairman Chris Dodd (D-CT) suggests that a letter of assurances from the incoming Obama administration, detailing its promises for responsible use of the bailout cash, could be enough to alleviate Dems' concerns.

From the Politico:

Dodd said he's prepared to draft legislation, mirroring a bill proposed by Rep. Barney Frank (D-Mass) last week, to call for a broadening of the TARP program and for more oversight, but he said that a letter from Obama's team - instead of additional legislation - could be sufficient to alleviate concerns in Congress.

"The Obama administration wants to rebrand this process," he said. "They realize it has been terribly mismanaged, they realize in order to be effective in assisting our credit markets to get them unclogged and moving again, this program has to be far better run than it has been.

Now, I'm not suggesting that the Obama administration harbors nefarious intentions to renege on its promises for stricter conditions on the second half of the TARP money. But a letter, no matter how well-intentioned, lacks the force of law -- and as Democrats take care to underscore their independence from Obama, they'd be well-served to make sure their oversight goals are set in stone.